Tuesday, 3 September 2019
Vanguard Lifestrategy - Portfolio Sale
The Vanguard Lifestrategy funds have been a cornerstone of my globally diverse passive portfolio for several years. They had been on my watchlist for a couple of years prior to my first purchase of the VLS60 in May 2015.
Since I started to move my portfolio towards more climate-friendly funds last year, I was concerned about the over exposure of the funds to the oil & gas sector due to its 25% equity allocation to the FTSE All Share index. For the past 10 months, I have been in regular contact with Vanguard Investors urging them to provide some low carbon sustainable funds as an alternative for investors who wish to avoid oil stocks. Despite many assurances that they are working towards such offerings, so far nothing has materialised.
I recently learn from @ShareAction (Twitter) that Vanguard's executives in the US have been voting to prevent the directors of big oil companies such as Exxon, Dominion and Duke from facing accountability on climate. This is a big red line for me.
I therefore no longer wish to be associated with a company that protects the likes of Exxon from climate scrutiny and have decided to dispose of my Lifestrategy 40 fund and will close my Vanguard Investor ISA. I have emailed Vanguard UK to inform the management of the reasons for leaving and I hope they will pass this on to the senior executives in the US.
The funds - VLS60 and 40 - have provided a steady return over the past four years - combined is just over 40% in total, so no complaints on that score. I realise my actions will be a mere drop in the ocean but I hope Sean Hagerty and the senior executives in the US will start to take our climate emergency seriously when investors begin to withdraw their investments and assets under management start to fall.
As ever, this article is merely a record of my personal investment decision to sell and should not be regarded as a recommendation - always DYOR!